Analyst: Rail rates to increase

By Lexi Dupre |Wednesday, January 15, 2014

Railroad shippers anticipate an average base rate increase of 4.1 percent over the next six to 12 months, according to Cowen and Company’s 4Q13 Rail Shipper Survey.
“This result is above the 3.6 percent expected in our 3Q13 survey, representing the second consecutive quarterly improvement and the first time since 1Q12 that pricing expectations have risen to the 4-percent range in our survey," the firm said in a release announcing the survey.
Cowen indicated that the 50 base-point jump in price expectations represents the biggest quarter-to-quarter increase since their 4Q09 survey, which showed a 100-point improvement.
“Shippers expect their respective businesses to expand at an average rate of 4.5 percent over the next 12 months. This is modestly better than the 4.3-percent result recorded in our 3Q13 survey,” Cowen stated.
Cowen expects all industry segments to grow; the outlook for transportation, consumer products, and forest and paper products improved from 3Q13. The outlook for petroleum products and chemicals declined from 3Q13, Cowen noted.